Indian economy from the time of independence was a close economy. The different political parties came into the power but the type of economic inclination was same for India. In 1991, the new era in Indian economy started with three key words - Liberalization, Globalization and privatization. With the globalization process the restructuring of Indian economy started and some major reforms were observed. Globalization brings a favorable impact on Economic growth. In 1970, the GDP growth was only 3 % in India. The countries like Mexico, Brazil achieved more than twice growth rate than India. In the eighties, a significant annual growth was observed from 3% to 5.9% but still it was comparatively very low compared to countries like China, Korea. In 1991, the GDP was calculated on purchasing power parity basis and Indian economic growth was 0.9 % only. Indian economy achieved a growth rate of 8% in the year 2003-2004. Not only the high GDP growth was noticed but also a significant structural change was noticed in Indian economy. Before the globalization, the maximum amount of GDP was generated from the primary sector. But after globalization, the maximum part of the GDP contribution comes from the service sector. ITES-BPO, software services providers has achieved a significant growth in recent years.The service sector is the major employment provider also in Indian Economy. In recent times, the service sector has a great contribution in the national income also. The reason for growth of service sector is urbanization, privatization and high demand for consumer service.The government of India formulated policies to make foreign direct investment in the manufacturing sector. The FDI in manufacturing sector was 40% in 1950 and it was increased to 90% in the year 1990. The overall foreign direct investment increased from US$100 million during 1990-1991 to US$5536 million in 2004-2005. In 2012, India has received 4.67 billion US dollars as inflows. The hotel and tourism received 2.32 billion US dollars inflows, chemicals received 51 million US dollars; pharmaceuticals received 987 million US dollars.Indian imports in 2004-2005 were US$ 107 billion. From 1991 to 2008, a huge increase in the export took place in Indian economy. In 1991, it was US$ 17865 million and in 2008, it was US$ 182631million. The growth of export was comparatively lower than the
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